Occasional postings on matters pertaining to economic sociology or socio-economics or political economy at the local (Jacksonville FL.), state, national, and global level.

Friday, December 20, 2013

Addressing Poverty in Jacksonville and Beyond

Several local media outlets have recently
reported on the local Jacksonville pilot program “1,000 in 1,000” aimed at addressing
the poverty problem and moving people toward economic self-sufficiency. The objective
is to move 1,000 people out of poverty in 1,000 days. This is a praiseworthy
goal, and the JaxChamber and Family Foundations – the two lead sponsors of the program
-- should be recognized for their efforts. It is especially welcome given the
almost universal avoidance by public officials, including President Obama, of
the “p-word”. Instead, almost all attention has been devoted to the mythical “middle-class”
despite the fact that it has been progressively hollowed out and downsized by
neo-liberal economic policies over the past thirty years -- yesterday’s
middle-class is today’s working poor. Therefore, a serious conversation about
poverty is long overdue.

The “1,000 in 1,000” poverty initiative employs
a program design targeting the social, human, and financial assets of the
working poor. According to the program model, if the value of these assets can
be enhanced – primarily through financial planning, career counseling, and
parenting training – the poor will be able to improve their standard of living,
become more self-sufficient and less dependent.

While the sponsors report preliminary progress
in moving the working poor toward self-sufficiency, the success of the program
will be severely limited by its own assumptions. Most significant among these is
the belief that poverty is primarily a product of individual deficiencies. More
specifically, it is assumed that poor individuals lack the requisite human
capital skills, motivational traits, and decision-making abilities to be
economically independent and financially successful. This “human deficit model”
leads logically toward a policy aimed at changing people that are poor –
through counseling, training, and self-help planning -- rather than addressing
the broader socio-economic conditions that are responsible for poverty.

It is here where one can benefit from the
insight of the late great sociologist C. Wright Mills, who reminded us that
what might appear to be a personal problem may in fact be the result of larger
social forces. Mills provided us with a simple way to determine the difference.
When only a small number of people suffer from a problem, it is a personal
problem; when millions suffer it is a social problem with social causes. In
2012, 46.5 million Americans, or 15% of the population, lived in poverty. In
2012, 40% of workers made less than $20,000. These figures do not reflect
personal deficiencies; they signal a problem with our socio-economic system.

Getting the cause of poverty wrong can
result in misplaced emphases. One example is found in the recent Times-Union
editorial praising the “1,000 in 1,000” program and endorsing the idea that the
poor need to adopt “middle class skills”.
But if middle-class skills are the key to success, why is it that
America’s suburbs, presumably the bastion of middle-class life, have experienced
the largest and fastest-growing poor populations in the country. As reported by
the Brookings Institute, “suburbs in the country’s largest metro areas saw
their poor population grow by 25 percent—almost five times faster than primary
cities and well ahead of the growth seen in smaller metro areas and
non-metropolitan communities.” Clearly, the poverty problem here cannot be
explained by underdeveloped skill-sets or inappropriate cultural dispositions. Further,
many of the so-called individual deficiencies presumably causing poverty are in
fact a consequence of economic deprivation and struggle. A recent study
published in Science reports that cognitive functioning – managing finances and
making decisions – is impeded by the objective state of poverty.

If the “1,000 in 1,000” program is to have its
intended impact, it will have to acknowledge and recognize the three most significant
contributors to poverty. The first is low
wage work. Jobs at or slightly above the minimum wage are insufficient for
fulltime workers to raise themselves above the poverty line. Some of the
largest and most profitable employers in the nation – in fast food and retail –
pay a poverty wage. If workers were paid a living wage, they would not have a
poverty problem nor would they have to rely on government assistance. As recent
studies have shown, highly profitable corporations – like Walmart and McDonalds
– pay their workers such a meager wage that most must rely on government
assistance to make ends meet. For the labor force as a whole, it is estimated
that a quarter are enrolled in or qualify for at least one form of public
assistance. Therefore, it is not the working poor who are deficient, but rather
their employers who at the same time are dependent on taxpayers to subsidize
their low wage regime.

A second rather obvious factor contributing to current
poverty is under- and unemployment.
For the vast majority of jobless Americans, the absence of employment is not a
personal choice but an involuntary state that reflects a failure of the US
capitalist economy to generate employment opportunities. Currently there are
approximately three job seekers for every available job. Flooding the labor
market with highly trained, motivated, and financially responsible people will
not eliminate unemployment; or, to put it in the language of economics, labor supply
does not create its own demand. Nor will
increasing the supply convert low wage jobs into high-paying jobs.

Together, low wage work and unemployment
inevitably produce significant rates of poverty in our society and communities.
No amount of financial planning, job training, or instilling the work ethic will
eliminate these structural features of the national and local economy.

But the “1,000 in 1,000” program proposal is
conspicuously silent on the issue of raising the minimum wage, establishing a local
living wage, or creating jobs. With the JaxChamber directly involved in this
initiative, it seems rather odd that there is no mention of a role or
responsibility for their members to provide workers with higher wages, or
greater and better employment opportunities. And it is unlikely the JaxChamber would
endorse a measure strengthening labor union representation that would allow
workers to collectively bargain for higher wages and greater job security.

The third critical factor in understanding
poverty is residential segregation by
race/ethnicity and social class. There are certain neighborhood communities in
every city that suffer from the highest rates and concentration of unemployment
and poverty. As it applies to addressing poverty in Jacksonville, a more
complete model would also include a community-based component that takes
“place” seriously. That is, how can the communities where people live be
transformed so that they provide an environment for economic security and
healthy lifestyles? Many of the poorest
most poverty-stricken communities have evolved in this way over time as a
result of private sector (dis)investment decisions. Therefore, a poverty
program should include a component aimed at rebuilding sources of wealth and
livelihood in those economically depressed communities and neighborhoods.

If these three factors -- low wage work,
unemployment, and community deprivation -- were considered in the analysis of
poverty in Jacksonville, the policy implications would be radically different
from those proposed by the “1000 in 1000” program. One example of a nation-wide
strategy moving in this direction is the Community Wealth initiative
(community-wealth.org). As the name
suggests, the primary purpose is to develop, create, and nurture community wealth-building
institutions that serve and are controlled by the local community and its
residents. These can include municipal-owned enterprises that provide services
and produce revenue, community development corporations, and worker-owned and
directed businesses and cooperative enterprises. What these institutions have
in common is their deep connection to the local community and the potential for
the democratic control and management of wealth. This can be contrasted with
the standard governmental approach using financial incentives, tax breaks, and
subsidies to lure and retain footloose corporations. This conventional strategy
has neither prevented widespread fiscal crises nor provided community residents
with economic security. It is for this very reason that there is currently a national
movement seeking alternative local economic development models that are
community and worker controlled.

The “1000 in 1000”
program has raised the level of consciousness about a serious social problem.
Now is the time to move the conversation to the next level by considering
additional strategies and alternative models designed to achieve the common
objective of securing a better quality of life for all the citizens of
Jacksonville.